While many business owners are focused on ending the financial year positively, it is just as important that you take the time to focus on building a performance culture into your business and people processes. Here are five ideas to consider when developing out your performance capabilities, and planning the next mountain your business will climb.
1. Financial Fundamentals
“How are we doing?” In business, setting goals and priorities to ensure your business is performing involves more than soul searching. You need to know what areas your business needs to improve in, or how fast it could improve relative to the economy, your industry or nearest competitors.
Although you may already have an idea of the key improvement areas, it’s important to regularly step back and review your business. And answer these questions: “What should we improve? Should the emphasis be on profitability? Growth? Something else?“(1)
2. Alignment to Strategy
“How well does your business strategy support the fulfillment of your company’s purpose? Purpose is what the business is trying to achieve. Strategy is how the business will achieve it. Purpose is enduring – it is the north star towards which the company should point. Strategy involves choices about what products and services to offer, which markets to serve, and how the company should best set itself apart from rivals for competitive advantage.” (2)
Think of your own business and ask yourself, what is your business’ north star? What is your purpose and what is your business trying to achieve?
Trevor and Varcoe devised an approach to start the conversation about strategy and organisational effectiveness, in your business. Ask your leadership team to rate the answer to these two questions on a simple scale of 1-100: “How well does our strategy support the fulfillment of our purpose?” and “how well does your organisation support the achievement of your business strategy?”(2)
The best companies are the best aligned in purpose, strategy and organisational capability, noted Trevor and Varcoe. How would your business score on these two questions?
3. Unfreeze the Middle
Through leadership development we have an opportunity to develop the capabilities of individual leaders, to enhance their ability to achieve alignment with your purpose, strategy and organisational capability; and to enhance their alignment with other leaders across your business. (3)
It is critical to train leaders to understand where the collaboration between levels of leadership are most important. And to provide your leaders with tools to help them align their efforts, with that of other levels leaders.
4. Accountability, Responsibility and Agility
“Accountability is about delivering on a commitment. It’s responsibility to an outcome, not just a set of tasks. It’s taking initiative with thoughtful, strategic follow-through.” (4)
What can you do in your business to foster accountability in the leaders and people around you? Bregman highlighted it is important to aim for clarity in these five areas: Set Clear expectations; be Clear on the capability required; provide Clear measurement; provide Clear feedback; and be Clear on the consequences.
5. Capability of Leaders to hold Quality Conversations
Frequent & quality conversations between leaders, managers and their teams is a critical success factor when reinventing performance. It is more effective for leaders to engage employees in meaningful frequent conversations and gain their commitment and accountability through trust and mutual respect.
Why not build a performance culture into your business and people processes, to improve your business outcomes?
About Gary Morgan
Gary Morgan is Founder and CEO at People Insights Group, Managing Director at MPT Innovation Group and an Adjunct Professor at Queensland University of Technology.
About People Insights Group
People Insights Group is a performance technology and consulting company that enables medium to large-sized organisations to transform the way they think about performance. Our cloud-based holistic performance frameworks integrate business and people to create a performance culture that increases accountability, and improves leadership and employee engagement and motivation to improve performance against business objectives.
1: Raynor, M, Ahmed, M, Pankratz, D, and Del Vicario, R. A theory of relativity: Setting priorities and goals for financial performance improvement. Deloitte Review. Issue 17, July 27, 2015
2: Trevor, J, and Varcoe, B. A Simple Way to Test Your Company’s Strategic Alignment. Harvard Business Review. May 16, 2016
4: Bregman, P. The Right Way to Hold People Accountable. Harvard Business Review. January 11, 2016